Industries Qatar Q4 net up 5.9pc to $494m

Doha, February 24, 2013

Petrochemicals and metals company Industries Qatar (IQ) posted a 5.9 percent rise in fourth-quarter net profit on Sunday, but still trailed analysts' forecasts as losses from fertilizer shutdowns hurt profitability.

The Gulf's second-largest chemical producer by market value behind Saudi Basic Industries (Sabic), made a net profit of 1.8 billion riyals ($494.4 million) for the fourth quarter, it said in a statement, compared with 1.7 billion riyals a year earlier.

Analysts polled by Reuters on average expected the company to post quarterly profit of 2.4 billion riyals.

Shutdowns in the company's ammonia and urea facilities weighed on the results, QNB Financial Services said in a research note.

"While the company stated that these shutdowns were planned, we believe that they were largely unanticipated. Despite the Q4 miss, we remain optimistic on IQCD longer term but change our rating to accumulate," the note said.

Petrochemical prices have strengthened in recent years, but worries persist over the impact of a global slowdown on industry earnings in the world's top oil exporting region.

IQ made a full-year net profit of 8.4 billion riyals, compared with 7.9 billion riyals in 2011, the statement said.

The company's board proposed a cash dividend of 8.5 riyals a share, the statement said.

A proposed 550 million equity restructuring will result in the company's shareholders receiving a stock dividend of an additional 10 percent of shares.

Total issued share capital will increase from 550 million shares to 605 million shares as a result of the move, subject to approval by the general assembly, IQ said.

Qatar has embarked on a massive domestic building programme in preparation to host the 2022 World Cup soccer tournament, with plans to spend $11 billion on a new international airport, $5.5 billion on a deepwater seaport and $1 billion for a transport corridor in the capital, Doha.

In April IQ said the steel segment was expected to "significantly benefit from the progressive and wide-ranging infrastructure plans of the State of Qatar."